STARTING A BUSINESS IN NORTH CAROLINA

Doing Business In North Carolina

Business Facts

Many of the world’s best-known brands across a range of future-focused industries call North Carolina home. They’ve grown far beyond the legacy industries of textiles, tobacco and furniture to address the world’s biggest challenges with companies that are inventing the future. From biotechnology to aerospace, transportation to information technology, you’ll find the people and infrastructure in North Carolina to take your company to the forefront of your industry.

Small Business and Startup Environment

North Carolina has 671,810 small businesses, according to the most current federal data available.

Of those 671,810 small businesses in North Carolina, 179,008 have employees. The remaining 492,802 are North Carolina small businesses that have no employees.

North Carolina has built one of the country’s strongest business climates over the past two decades, fueled by low business costs, incentives and a young, educated workforce, many of whom have been trained at the strong universities in the state and Research Triangle Park. Migration rates into the state are among the highest in the U.S. annually. The Tar Heel State is the only one to rank among the top five on FORBES’ Best States for Business for 12 straight years

While Charlotte, NC, has long been known for being a hub for financial companies, the Research Triangle area has historically struggled to be a formidable alternative for tech startups to call home. The sheer number of universities has been an asset for the region. (They include Duke University, UNC-Chapel Hill, NC State University, and nearby Wake Forest University, just to name a few) But many of the schools’ engineering or computer software graduates often left North Carolina after graduating, lured by the higher tech salaries and the potential to raise more venture capital in other markets.

Major Companies

North Carolina is home to large companies such as: Lowe’s Companies, Bank of America, U.S. Trust, Compass Group, Total, VF, Hanesbrands, Lab, QUINTILES IMS HLDGS, Family Dollar

Step 1: Choose A Business Structure

The most common business structures are sole proprietorship, partnership, limited liability company (LLC), and a few different types of corporations—the standard corporation (often called a C corporation or “C corp”), the small business corporation (often called an S corporation or “S corp”), and the benefit corporation (often called a B corporation or “B corp”).

The most common business structures are:

► Sole Proprietorship in North Carolina:

Happens when you operate your business as yourself. There is no separate legal entity created; the law treats you and your business as one person. You are responsible and personally liable for all business activities or wrongdoing.

► North Carolina Partnership:

The same thing as a Sole Proprietorship, but just with 2 or more people. Like a Sole Proprietorship, a Partnership doesn’t create a separate legal entity and the partners are responsible and personally liable for any business activity or wrongdoing.

► North Carolina Corporation:

A more complex legal structure that requires a board of directors, corporate officers, and shareholders. Corporations don’t usually work for most small business owners since they face double taxation. Corporations can be beneficial to companies that are looking to raise capital investment, take the company public, or have large healthcare expenses for their employees. The most common types of companies that form Corporations are high-growth technology and startup companies.

Unlike a Sole Proprietorship or a Partnership, a Corporation is a separate legal entity from its owners (called shareholders). It provides them with personal liability protection.

► North Carolina LLC:

A legal entity that combines the benefits of a Corporation and a Sole Proprietorship/Partnership.

An LLC in North Carolina is a separate legal entity under the law. And like a Corporation, it provides personal liability protection for the owners. If the LLC is sued, the owner’s personal assets – like their home, cars, and bank accounts – are protected. And like a Sole Proprietorship/Partnership, an LLC has pass-through taxation (so there’s no double taxation).

A North Carolina LLC is the most popular option and a good choice for people who want to run a small business for two reasons:

Personal liability protection (personal assets are kept safe)
No double taxation

Unlike a Sole Proprietorship (and a Partnership), your North Carolina LLC’s assets are separate and distinct from your personal assets. In the event your LLC gets sued, your personal assets are protected.

And unlike a Corporation, your LLC is not subject to double taxation. Instead, your LLC’s profits will “pass-through” to your personal tax return and federal taxes are paid just once.

Step 2: Choose The Right Business Name

Choosing a business name is important, you want to make it easier for your customers to remember it, here are some tips:

Avoid hard-to-spell names.
Don’t pick a name that could be limiting as your business grows.
Conduct a thorough Internet search.
Search and purchase a domain name.
Use a name that conveys some meaning.
Conduct a trademark search.

Step 3: Register Your Business

Depending on the business structure you chose you will need to register your business.

Resale license

https://www.ncdor.gov/taxes-forms/sales-and-use-tax/sales-and-use-tax-registration

Department of corporations

https://www.sosnc.gov/online_services/search/by_title/_Business_Registration

SBA Office

https://www.sba.gov/offices/district/nc/charlotte

Step 4: Obtain an EIN Tax Number

With limited exceptions, most businesses require an Employer Identification Number (EIN), also known as a Tax ID Number. An EIN is used to identify a business in its federal tax filings. Without an EIN, you can’t hire employees or open a business bank account.

Click Here to Apply for EIN number online

https://www.smartskynetworks.com/

https://www.ncino.com/

https://www.pendo.io/

https://www.precisionhawk.com/

Get Inspired by these North Carolina Startups

https://www.smartskynetworks.com/

https://www.ncino.com/

https://www.pendo.io/

https://www.precisionhawk.com/

Step 5: Open A Bank Account

– Open a business bank account:

Separates your personal assets from your company’s assets, which is necessary for personal asset protection.
Makes accounting and tax filing easier.

– Get a business credit card:

Helps you separate personal and business expenses.
Builds your company’s credit history, which can be useful to raise capital later on.

Step 6: Licenses & Permits

Now that you’ve registered your business name you need to obtain a business license for your company – this authorizes your company to do business in your city or county. Typically this also involves registering for state taxes and permits (the city may require them as part of the business licensing process).

Here are some links for North Carolina Businesses:

Selling products? Check North Carolina Resale Permit

Business Licensing for the State of North Carolina

Step 7: Branding & Marketing

Your brand is the image customers have of your business, so it’s important to determine who is your audience and what is the message that you want to project. That way, your company’s image will be what you intend it to be. It should be strategic and intentional.

Step 8: Establish a Web Presence

Creating an optimized website helps you to gain important visibility for the right terms. A website is a powerful sales tool and one that allows you to address your customers’ concerns, give them the information they need to make a decision and create compelling calls to action.

In addition to a website, you should also consider other avenues for promoting your business online: